The National Association of Realtors President Ron Phipps recently spoke at a town-hall meeting in Colorado as part of the trade group’s cross-country Home Ownership Matters Bus Tour. When one Realtor commented that, “It’s frustrating when deals fall through because of financing,” Phipps said that real estate professionals need to get strategic about their deals. “If your buyer can’t find a loan with one of the big four banks, find a local one. It’s your job to help them to get into the house.”
Says Mitchell Hirsch, an attorney at Hirsch and Hirsch LLP in Hempstead: “I have always been a proponent of using local lenders for home financing. In the same way that local shops should be supported over the big box stores, local banks invest in the community. They keep their loan in their own portfolios without securitizing them. This makes for a healthier local economy. And small local banks may be able to be more subjective and evaluate candidates the way it was done years ago--face-to-face.”
“I still find that directing customers to mortgage brokers gets better results," says Barbara L. Bornstein, a licensed associate broker with Sotheby's International Realty. "For the more difficult deals, brokers often know which banks have portfolio loans, and in this difficult time of new appraisal rules, know the banks which have the best appraisers on their approved list."
Steven Schnall, chief executive of Quontic Bank in Great Neck, says that a proactive Realtor should direct his client to local banks they may not have considered for mortgage financing. “With the significant curtailment in securitization activity, it’s much more difficult for consumers to finance homes. Community banks get to know their customers and may not be as beholden to the strict vanilla guidelines that the big banks are," he says.